Tesco faces huge equal pay case

Published: February 11, 2018 Last modified: February 11, 2018

Supermarket giant Tesco is facing possibly the largest equal pay challenge in UK history after law firm Leigh Day announced legal proceedings claiming up to £4 billion to compensate workers.

In June 2016 the employment tribunal found that lower paid female workers at Tesco’s rival Asda could compare themselves to higher paid men who work in distribution centres.

Lawyers, who say they have already been approached by more than 1,000 employees and ex-employees at Tesco, are making the same argument as the Asda case and another case against Sainsbury’s. The Tesco equal pay claim focuses on employees working in male-dominated distribution centres being paid considerably more than the largely female-staffed Tesco stores.

Warehouse employees sometimes earn in excess of £11 an hour, while the most common wage for store staff is £8 an hour. This disparity could see a full-time distribution worker earning £5,000 more per year than store staff on the same hours.

The underpayment could apply to in excess of 200,000 Tesco employees, with estimated pay shortfalls that could reach £20,000.

Paula Lee from the employment team at Leigh Day said: “We believe an inherent bias has allowed store workers to be underpaid for many years. In terms of equal worth to the company, there really should be no argument that workers in stores, compared to those working in distribution centres, contribute at least equal value to the vast profits made by Tesco.”

It’s a different to equal pay, but on its web pages, Tesco addresses the gender pay gap in its UK operations and here it claims a voluntarily reported a gap of less than 1% in 2016. This allegedly was “based on an analysis of the pay received by male and female colleagues at equal levels of work”.

Tesco has — like all of the big supermarkets — yet to file its statutory gender pay gap report for 2017 but it reports a median (midpoint) gender pay gap for the year to April 2016 of 8.6%.